From boom to frightening bust: where the UK housing market has been hit hardest

The region: Northern Ireland

Most property prices quoted in the popular media look only at England and Wales or sometimes all of Great Britain. But over in Northern Ireland, the housing market is volatile to a far greater degree.

In the new year, Northern Ireland's house prices were rising by 24.4 per cent annually. Now the figure is 3.4 per cent. The number of completed sales has fallen to its lowest level since 1984. As slowdowns go, this one is moving at Formula 1 speed.

'Over the last five years, prices increased by over 160 per cent - nearly three times that of the rest of the UK. These increases put unusual strains on first-time-buyer affordability and were never likely to be sustainable over an extended period,' explains Fionnuala Earley of the Nationwide building society.

Economist Alan Brindle, head of research at the Bank of Ireland's Northern Ireland arm, says the market 'hit a brick wall' in late 2007 and has not recovered. Sales are down by over a third on a year ago in 'a market that is still stricken with relative inactivity, uncertainty and nervousness over valuations', he says. According to his bank's index, a typical home in Northern Ireland now costs £230,908.

Doing well

In the first quarter of the year - the most recent data available - prices of detached houses across the region rose by 4.4 per cent, but every other property type was tumbling.

The market is extraordinarily fragmented and many locations are still showing high rises. For example, North Down, despite a large number of new apartments flooding on the market, rose 3.1 per cent in the first quarter and prices in the area are 10.7 per cent higher than they were 12 months ago.

Belfast performed significantly better than elsewhere, with an average price of £254,011, still 22 per cent higher than a year ago. South Belfast is highest priced, followed by the east, north and west.

Doing badly

Across the region, prices of apartments fell by an average of 2.5 per cent in the first quarter. Semi-detached houses were down 6.5 per cent, terraced houses dropped 8.8 per cent and bungalows fell by as much as 12.3 per cent.

Research conducted by the University of Ulster shows that homes priced below £250,000 are in general doing significantly more badly than more expensive ones.

Some locations have seen devastating price falls. In Craigavon and Armagh, prices fell 24.2 per cent in the first three months of this year alone. The largely rural Mid-Ulster area is down 17.7 per cent, and Antrim/Ballymena down 9.7 per cent, for the year.

Tell-tale signs

There has been a glut of estate agency closures and developers have effectively downed tools. Data from the National House-Building Council show the total of new homes registered in Northern Ireland in the first quarter of 2008 was just 736, compared with 2,131 in the same period of 2007, a staggering 65 per cent drop.

More property may come on sale soon, adding to the downward price pressure, if owners of 36,000 empty homes object to the steep rises in local rates they must pay while their buildings remain unoccupied.